Herbert C. Hoover: 31st Retrospective

“Whatcha got ain’t nothin new. This country’s hard on people, you can’t stop what’s coming, it ain’t all waiting on you. That’s vanity.” – Ellis, No Country for Old Men (2007)

Herbert Hoover was one of the most respected men in America by the late 1920’s. After World War I started, he organized a relief effort in war-torn Belgium that saved millions from starvation. He was the food administrator under President Wilson and Secretary of Commerce under Presidents Harding and Coolidge. He’s known now for the Depression which in some ways is unfortunate. As President, he introduced highly innovative social welfare and conservation policies. He wrote his own speeches. He wrote his own books.

Herbert Hoover

Hoover was the first President born west of the Mississippi. He was a shy loner. A Stanford graduate who started a successful mining company that made him a millionaire. He loved fishing and invented Hoover Ball in an effort to exercise and get leaders of government to get together to share ideas.

Hoover was your quintessential big-business republican who had trouble relating to the common man. He wore stiff double-breasted suits, high collars and was easily lampooned as your stereotypical big businessman.

Hoover was one of an early handful of international capitalists, but he had a highly developed sense of obligation. He once stated, “The trouble with capitalism is capitalists; they’re too damn greedy.”

Hoover brought the efficiency of business management to the presidency. It can’t be emphasized enough how successful he was as a businessman, and he wanted to bring a crisp executive style to Washington.

Hoover was a workaholic. I mean he really believed in work. He was always on the job and believed more hours and working harder would solve the problem. Like in business, Hoover’s strong work ethic and proven management skills, would be successful for the country as well.

The Great Depression

The Great Depression ended any chance of that for Hoover. In October 1929, the stock market crashed, marking the end of six years of unparalleled prosperity for most sectors of the American economy. On October 24 — Black Thursday — stock prices plummet and panic selling ensues as people try to sell stocks for any price they can get.

By October 29 — Black Tuesday — stocks will completely collapse and banks will be calling in loans. An estimated $30 billion in stock values will “disappear” by mid-November. In November, President Herbert Hoover says, “Any lack of confidence in the economic future or the basic strength of business in the United States is foolish.”

In March of 1930, more than 3.2 million people are unemployed, up from 1.5 million before the October, 1929 crash. President Hoover remains optimistic, however, stating that “all the evidences indicate that the worst effects of the crash upon unemployment will have passed during the next 60 days.”

By November of 1930, the street corners of New York City are crowded with apple-sellers. Nearly 6,000 unemployed individuals work at selling apples for five cents apiece.

In January of 1931, legislation is introduced authorizing immediate payment of “bonus” funds to veterans of World War I. The “bonus bill” had been passed in 1924. It allots bonuses, in the form of “adjusted service certificates,” equaling $1 a day for each day of service in the U.S., and $1.25 for each day overseas. President Hoover is against payment of these funds, saying it would cost the Treasury $4 billion.

“Food riots” begin to break out in parts of the U.S. In Minneapolis, several hundred men and women smash the windows of a grocery market and make off with fruit, canned goods, bacon and ham.

One of the store’s owners pulls out a gun to stop the looters, but is leapt upon and has his arm broken. The “riot” is brought under control by 100 policemen. Seven people are arrested.

Resentment of “foreign” workers increases along with unemployment rolls. In Los Angeles, Mexican Americans are accused of stealing jobs from “real” Americans. During the month, 6,024 Mexican Americans are deported.

In December of 1931, New York’s Bank of the United States collapses. At the time of the collapse, the bank had over $200 million in deposits, making it the largest single bank failure in the nation’s history.

In January of 1932, Congress establishes the Reconstruction Finance Corporation. The R.F.C. is allowed to lend $2 billion to banks, insurance companies, building and loan associations, agricultural credit organizations and railroads. Critics of the R.F.C. call it “the millionaires’ dole.”

In March of 1932, three thousand unemployed workers march on the Ford Motor Company’s plant in River Rouge, Michigan. Dearborn police and Ford’s company guards attack the workers, killing four and injuring many more.

In April of 1932, more than 750,000 New Yorkers are reported to be dependent upon city relief, with an additional 160,000 on a waiting list. Expenditures average about $8.20 per month for each person on relief.

In May of 1932, More than 300 World War I veterans leave Portland, Oregon, en route to Washington, D.C. to urge Congress to pass the Bonus Bill. It will take them 18 days to reach Washington, D.C.

In June of 1932, determined to collect their “bonus” pay for service, 15,000 – 25,000 World War I veterans gather and begin setting up encampments near the White House and the Capitol in Washington, D.C. On June 15, the House passes the “bonus bill” by a vote of 209 to 176. The bill falls to defeat in the Senate, however, 62 to 18. The vets maintain their determination to stay camped out until they get their pay.

In July of 1932, the Reconstruction Finance Corporation is authorized to lend needy states sums from the National Treasury. The money is to target relief and public works projects.

President Hoover signs a $100,000 transportation bill to assist “bonus Army” demonstrators in getting home. He sets a July 24 deadline for the men to abandon their encampments.

On July 28, when some “bonus Army” members resist being moved from their camps, violence erupts, leading to the deaths of two veterans. Hoover orders Federal troops, under the command of General Douglas MacArthur, to assist D.C. police in clearing the veterans.

Hoover’s Inadequate Response

Hoover held a strong belief in American individualism, free enterprise, and decentralized government, but at the same time, he was not a supporter of laissez faire doctrine. He opposed an economic free-for-all since he believed it led to a concentration of power that stifled equality of opportunity and initiative.

Rather, he believed in an individualism fused with public service. Hoover proposed that volunteerism within the community was the best antidote for poverty as well as for a myriad of other social problems. He called on individuals, local charity organizations, churches, and local governments to work cooperatively to alleviate suffering and distribute relief. Hoover claimed that voluntary cooperation was “self-government by the people outside of the Government.”

When the economy tanked in October of 1929 all of a sudden, the many qualities that made Hoover good for leading in a time of prosperity made him grossly inadequate for dealing with the challenges of the depression. He was handicapped by a lack of charisma, and his lackluster public speeches did not inspire confidence.

This was obviously a tremendous mistake as the government certainly needed to do more after the crash. Nothing has ever shown volunteerism to work in the United States before Hoover nor afterwards. The depression traumatized Hoover. He became defensive as it became clearer that he did not have the temperament to deal with a crisis of this magnitude.

Bonus Army Ends Hoover

Hoover had the misfortune of running for reelection during a deep depression. His name became a punchline. A Hoover hotel was a cardboard shack. A Hooverville was a collection of Hoover Hotels. A Hoover flag was an empty pocket turned inside out.

The summer of 1932 was miserable for Hoover. He hit the campaign trail and tried to put on a brave face, but everywhere he went loomed the specter of hunger and anger. This was no more evident than with the Bonus Marches.
The Bonus Army, some 15,000 to 20,000 World War I veterans from across the country, marched on the Capitol in June 1932 to request early payment of cash bonuses due to them in 1945. The Great Depression had destroyed the economy, leaving many veterans jobless.

Six futile weeks of lobbying Congress raised government fears of riots, and on July 28, cavalry, infantry, tank troops and a mounted machine gun squadron commanded by General Douglas MacArthur and Major Dwight Eisenhower dispersed veterans and their families with bayonets and tear gas. Public opinion denounced President Herbert Hoover for the resulting bloodshed and helped force him from office.

In particular, MacArthur exceeded Hoover’s orders of evacuating buildings, by pressing onto the Anacostia flats where he torched the encampment. Hoover took the blame though and it would be the last nail in his coffin. Upon hearing of the news of the Bonus Army FDR purportedly said to his adviser Felix Frankfurter, “Well, Felix, this will elect me.”

Hoover’s Legacy

The 1920s were an age of dramatic social and political change. For the first time, more Americans lived in cities than on farms. The nation’s total wealth more than doubled between 1920 and 1929, and this economic growth swept many Americans into an affluent but unfamiliar “consumer society.” Hooverism was not equipped to deal with the inefficacy of its core tenet of volunteerism. Companies felt their bottom line was better served by laying off workers than raising their wages and increasing their benefits.

In the 20’s, people from coast to coast bought the same goods (thanks to nationwide advertising and the spread of chain stores), listened to the same music, did the same dances and even used the same slang! Many Americans were uncomfortable with this new, urban, sometimes racy “mass culture”; in fact, for many or even most people in the United States, the 1920s brought more conflict than celebration. As a wealthy businessman, Hoover was not in tune with public sentiment nor feeling at all. He was “winning” too much.

Hoover is often unfairly compared to FDR when it’s all about timing. FDR’s simple message was “though you have no hope, no food, nor a job today, it will be better tomorrow.” Things were not getting better under Hoover.

Looking at Hoover under that prism is unfair. If a public charmer and glad-hander like FDR had taken office in 1929, he would have been hated by 1932 and the country would’ve been clamoring for a business executive who understood the economy. Someone like Herbert Hoover.

Bitching

During the economic boom of the Roaring Twenties, the traditional values of rural America were challenged by the Jazz Age, symbolized by women smoking, drinking and wearing short skirts. The average American was busy buying automobiles and household appliances, and speculating in the stock market, where big money could be made.

Those appliances were bought on credit though. Although businesses had made huge gains — 65 percent — from the mechanization of manufacturing, the average worker’s wages had only increased 8 percent.

The imbalance between the rich and the poor, with 0.1 percent of society earning the same total income as 42 percent, combined with production of more and more goods and rising personal debt, could not be sustained. With banks failing and businesses closing, more than 15 million Americans (one-quarter of the workforce) became unemployed.

Hoover underestimated the seriousness of the crisis, calling it “a passing incident in our national lives,” and assured Americans that it would be over in 60 days. Focusing on a trickle-down economic program to help finance businesses and banks, Hoover’s vision was thwarted by business executives who preferred to simply lay off workers.

Trickle-down or Hoover economics was the staple of the GOP platform for about 90 years until Donald Trump came along. Now, we don’t know what the party stands for as Trump has no platform. That’s why his ascendancy to the nomination is historic. His platform is unknown and not rooted in economic nor political theory but the whims of populism.

Blacks suffered more than whites during the depression, since their jobs were often taken away from them and given to whites. In 1930, 50 percent of blacks were unemployed. Latino immigrants were blamed for taking people’s jobs, and deportations ensued. Does any of this sound familiar?

Banks and other financial institutions were not bailed out in the beginning of the depression and we saw the result. We also see how “supporting the troops” was completely counterbalanced by fiscal concerns of government spending during a Depression (which we should have been doing). Hoover swung and missed entirely on the economics and the politics of depression.